India is in real danger from climate change: Nicholas Stern

Green advice: The UK government’s chief economist Nicholas Stern believes that the 11th Five Year Plan, which will be announced this week, should focus on energy-efficiency.

Updated: Mon, Nov 05 2007. 01 09 AM IST

A rise in global temperatures by 3 degrees Celsius will melt most of the Himalayan ice and snow that feeds the rivers in North India, could lead to major dislocations in the monsoon and make peninsular India vulnerable to rising sea levels, according to economist Nicholas Stern, who authored a path-breaking report on the economics of climate change for the British government earlier this year.

“India is in real danger from climate change,” he says.

Green advice: The UK government’s chief economist Nicholas Stern believes that the 11th Five Year Plan, which will be announced this week, should focus on energy-efficiency.

But, while India cannot avoid the risks that come from global warming, Stern argues that the rich countries should bear the bulk of the costs of cutting emissions of greenhouse gases and that India should insist on this in global policy negotiations.

Stern works the numbers in support of his position. “The six billion people on earth emit 400-450 giga tonnes of carbon dioxide a year. That’s around seven tonnes per capita,” says Stern.

The June summit of the G8 group of rich countries in Germany (Prime Minister Manmohan Singh also attended) has set a target of halving these emissions by the year 2050. Other governments, including the US state of California, too, have been talking about similar cuts. “There will be nine billion people on earth in 2050,” Stern notes. “If emissions are halved from their current levels, then per capita levels will be between two to three tonnes.”

Stern says most rich countries are way above that level. The US has per capita carbon dioxide emissions of around 20 tonnes, the European Union has around 10 tonnes and China has 3.5 tonnes.

In contrast, India has per capita emissions of only one tonne, far below the 2050 target. It is likely to stay below the three-tonne level despite a growing economy and rising energy consumption, perhaps the only major economy in the world to do so.

While governments will have to agree on emission limits, Stern says the two other long-term solutions are carbon markets and new technologies such as carbon capture. And the two are linked.

Carbon markets are part of the cap-and-trade approach to countering climate change. Governments impose pollution limits, or caps. Those who pollute more than permitted will have to buy the right to indulge in excess pollution from others who have not used up their pollution permits. These permits are traded in global markets for carbon.

High prices will be an incentive to invest in and use clean technologies. “Carbon permits should have far higher prices than now,” says Stern, adding that prices of around $30-40 (Rs1,182-1,576) per tonne of carbon dioxide will make new technologies such as carbon capture commercially viable.

The prices of pollution permits have collapsed, partly because the EU has allegedly given out too many permits. Recent trades have been at around $10 a tonne of carbon.

Responding to questions about whether poor countries such as India can sacrifice economic growth now to protect the environment in the future, Stern sees no conflict between the two.

“This is not about stopping growth but moving to low-carbon growth,” he says.

Stern believes that the new 11th Five Year Plan, which will be announced this week, should focus on energy-efficiency.

“I think India’s policymakers are sensitive to these needs,” says the old India hand, who has tracked the economy of Palanpur, a small village in Uttar Pradesh, for 30 years and holds the I.G. Patel chair at the London School of Economics, where he heads the Indian Observatory.